By David Doe FIERGBOR
Agriculture has long been the backbone of Ghana’s economy, contributing about 21 percent to GDP and employing over one-third of the labour force. But beneath this economic significance lies a persistent vulnerability.
Smallholder farmers, who produce most of Ghana’s food supply, remain disproportionately exposed to climate shocks, pest outbreaks, post-harvest losses and market volatility.
Despite their risk exposure, insurance penetration among these farmers is negligible. This isn’t merely a gap; it’s a business failure and an untapped opportunity.
The traditional insurance model, with its rigid underwriting rules, manual claims processes and costly distribution, is fundamentally incompatible with the realities of smallholder farming.
In addition to the fragmented nature of agricultural data, low trust in insurance services and poor rural connectivity, it becomes clear why the model has struggled to scale.
It is not incremental reform; digital reengineering of the entire value chain is needed. This is where the convergence of Insurtech and Agritech, powered by open insurance principles, can create breakthrough solutions.
Unlike conventional insurance transformation models, the current frontier lies in digital interoperability, which creates open API-driven ecosystems where insurtech platforms can integrate seamlessly with agritech applications.
These integrations allow for real-time data exchange, automated risk assessment and instant rules-based claims processing, all of which reduce friction, lower costs and enhance transparency.
Most importantly, they enable agricultural insurance to be embedded in the farmer’s everyday digital journey, be it input purchases, weather alerts, market pricing or credit access.
Moreover, agritech firms like Farmerline, AgroCenta, Grow for Me and Syecomp have built robust digital ecosystems across Ghana’s farming communities to offer scale, trust and high-frequency farmer engagement.
In contrast, Insurtech firms like aYo, BIMA and MIC Global have also built the digital rails for product creation, claims automation and risk sharing. What’s missing is the open bridge between these two digital economies, a bridge that open insurance can provide.
Forming a federated, data-driven and API-enabled ecosystem is essential to delivering accessible, affordable and reliable agricultural insurance across Ghana.
Open insurance: Rethinking distribution data and digital trust
Agriculture insurance, at its core, suffers from three chronic failures: inaccessible distribution, poor data for underwriting and a deep deficit of digital trust.
Open insurance addresses these by enabling modular, composable insurance ecosystems that can plug directly into Agritech platforms where farmers are already transacting, learning and growing.
Open APIs allow insurance providers to tap into Agritech data ecosystems ranging from satellite imaging and weather tracking to geo-location, yield monitoring and transaction history.
These data points are critical for parametric insurance models, where claims are triggered by defined events like drought or excess rainfall, eliminating the need for manual claims assessment.
By integrating with Agritech APIs, Insurtechs can dynamically underwrite individual farm-level risk, something traditional insurers cannot achieve with pen-and-paper surveys.
On the distribution side, open insurance allows insurance products to be embedded seamlessly into existing digital experiences: bundled with inputs sold on an Agritech app, offered as a value-add on mobile agri-credit or auto-enrolled with agronomic advisory services.
This embedded model is critical, where most smallholder farmers are underbanked or excluded from formal financial channels. By integrating insurance directly into their trusted platforms, farmers are more likely to opt in because the product is contextual, timely and easy to understand.
Furthermore, open systems allow for real-time visibility across the insurance value chain, where farmers can monitor coverage, receive claim notifications and engage in two-way communication with insurers through SMS, WhatsApp or mobile apps. This visibility builds digital trust, essential in markets where insurance is often viewed with scepticism.
API integration: The technology that makes it work
Agritech platforms maintain robust databases of farmer identities, land coordinates, farm size, input usage, yield history and behavioural patterns. These platforms offer APIs to access their services, enabling digital tools like advisory systems, mobile money wallets and e-marketplaces to plug into their ecosystems.
However, these datasets are severely underutilised in the insurance underwriting space. That’s where Insurtechs must come in, not with a separate app or standalone product; but by integrating directly into the Agritech platform’s core operating environment via APIs.
Insurtech platforms are built with sophisticated APIs that manage policy issuance, dynamic pricing, real-time claims automation, customer authentication and policy lifecycle management.
By integrating with Agritech platforms, these APIs can instantly access a goldmine of pre-existing data to personalise and underwrite micro-policies.
For instance, a farmer’s historical yield and rainfall exposure can inform pricing and the type of risk product offered, whether parametric, hybrid or indemnity-based.
Moreover, when insurers are plugged into real-time environmental data such as rainfall indices, Normalised Difference Vegetation Index (NDVI) scans and satellite-based soil moisture readings, claims can be auto-triggered and settled instantly without needing a field visit. This eliminates fraud, reduces operational overhead and significantly builds user trust.
A working API bridge between meteorological agencies, Agritech partners and insurance claims systems is innovative and transformative.
Furthermore, as new risks emerge, including pest outbreaks and climate-induced migration, insurers can deploy, test and iterate products faster without rebuilding core systems.
The modularity of open APIs supports plug-and-play product models where insurers can co-create bundled offerings with agri-input suppliers, banks, cooperatives and telcos.
For data security and privacy concerns, APIs must be designed with robust encryption, tokenisation and customer data protection protocols, enabling farmers to have visibility into how their data is used and the ability to revoke access if necessary, which is essential to ensure building ethical digital infrastructure that fosters long-term trust.
Business model innovation: Embedded insurance and strategic partnerships
Products will not shape the future of agricultural insurance in Ghana. Platforms and partnerships will shape it. Traditional standalone insurance offerings are ill-suited for smallholder farmers who operate in fragmented, informal value chains.
What’s required is a business model shift from selling policies to embedding protection within digital agriculture ecosystems, creating shared value across the chain.
Instead of requiring farmers to actively seek out and purchase a product, insurance becomes invisible, integrated and automatically offered at the point of need with the tools farmers already use.
Whether bundled into a loan product, included with an input purchase or triggered by enrolment in a weather advisory service, embedded insurance lowers friction, increases uptake and delivers relevance.
Agritech platforms, as gateway, have spent years building trust with farmer networks, gathering data and offering services like input distribution, digital agronomy and market access.
They know the farmer journey intimately while Insurtechs, in turn, provide an infrastructure to create, price, underwrite and settle micro-policies at scale. By forming API-enabled partnerships, both sides unlock new value propositions to Agrotech while Insurtechs gain instant distribution and contextual customer engagement.
For instance, an Agritech could embed weather-indexed insurance into every fertiliser bundle sold via its platform. A parametric insurance policy could trigger payouts directly to the farmer’s mobile wallet if rainfall deviates significantly from seasonal norms.
The underwriting is done dynamically based on the farmer’s GPS coordinates and local weather station data, while the claim is verified and processed automatically without human intervention.
Moreover, Agritechs benefit from stronger customer loyalty, higher transaction volume and enhanced brand credibility, while Insurtechs benefit from broader reach, richer risk data and faster feedback loops for product iteration.
For insurers and reinsurers, this could lead to lower loss ratios, reduced fraud and expanded premium pools, while investors are engaged in platforms that demonstrate scalability, data-driven innovation and customer lifetime value.
Critically, this model supports unit economics, which works where the marginal cost of distribution drops to near zero.
For regulators and policy-makers, though this model raises essential questions around disclosure, consent and transparency, with the proper policy framework, embedded insurance would offer smart protection delivered at the speed of commerce.
Conclusion
The integration of Insurtech and Agritech via open insurance could transform agricultural insurance but this change requires more than just innovative products or advanced technology. This requires the creating of an open and inclusive ecosystem for a strategic alliance between Insurtechs, Agritech platforms, insurers, regulators and investors.
This partnership hinges on the interoperability of systems, the efficient flow of data and the aggregation of resources to meet the unique needs of smallholder farmers whom traditional insurance models have historically underserved.
Insurtech offers the technology and infrastructure to provide dynamic pricing, claims automation and real-time underwriting, while Agritech platforms bring critical data, customer relationships and distribution channels.
Together, these sectors can unlock the potential of micro-insurance, parametric policies and embedded insurance products that offer farmers a level of coverage and accessibility previously unimaginable.
David is Lead, Digital & Partnerships at Banbo Insurance Brokers
Email: [email protected] Tel: +233249915690
